For many of us approaching retirement, collecting the maximum possible from Social Security will mean the difference between a comfortable retirement and a coupon-clipping, austere budget in our golden years. So it’s critical to understand how our national retirement system works, and the ways it can be used to better serve us as individuals.

Here’s this week’s reader question:

Why do you and others keep telling people to wait until 70 to collect Social Security? If you can afford to retire at 62, you will have eight years of good retirement that you wouldn’t have otherwise. In the meantime, the money you would have taken from your investments has additional years of growth. The longer you wait for retirement, the worse your health will be. — Ted

Ted’s right. I do often say to wait till 70 to take Social Security. For example, here’s a video we did a while back called “How to Get More Social Security.” You’ll note waiting is one of the things I suggest.

Now, on to Ted’s question:

No advice is one-size-fits-all

James Withers was my oldest friend. The only people I knew longer were my parents and sister.

A few years ago, when James was 58, he discovered he was eligible for a small pension from a long-ago stint as an elevator repairman. He called to ask my advice about the two options he was presented: a small monthly check now, or a significantly larger one when he turned 65.

Based on the advice I’ve offered about Social Security, you’d assume I told James to wait until 65. I didn’t. I told him to take it ASAP. Why? First, at the time he didn’t have two nickels to rub together. Next, his father had died at a young age, his mother had died fairly young, and his three siblings were also gone. So his odds of a long life were slimmer than most, especially considering his lifestyle wasn’t the healthiest. Last but not least, he’d recently suffered a heart attack.

Last spring I gave the eulogy at James’ funeral. I miss him. And I’m very glad I didn’t advise him to wait for his money.

The point here is that while people like me use broad strokes to address mass audiences, we’re all different, and we shouldn’t all do the same thing. Some of us will die younger, and therefore should take as much as we can get as early as we can get it. Some of us will become too frail to enjoy life at 70. Some of us have jobs we can’t wait to quit, while others can’t imagine ever quitting. Some of us have substantial nest eggs, some of us don’t.

Forget the math

If you take Social Security when you turn 62, you’ll get 25 percent less than if you wait until you turn 66. If you wait until 70, you’ll get 32 percent more than if you took your benefits at 66, and 76 percent more than you’d have gotten at 62.

But here’s something important. Theoretically there should be no difference between these options; you should receive the same basic lifetime amount under all three.

The government doesn’t reward you for waiting or penalize you for starting early. They’re simply attempting to pay you what you’re owed over your lifetime. Doing that requires smaller checks for a longer period if you take it early or larger ones for a shorter period if you wait.

So when Ted says, “If you can afford to retire at 62, you will have eight years of good retirement that you wouldn’t have otherwise,” he’s absolutely right, provided the income you’ll receive at 62 will be enough to live on for the rest of your life.

He also says, “In the meantime, the money you would have taken from your investments has additional years of growth.” Also true. But that assumes that those not retiring at 62 are depleting, rather than adding to, their investments. If you keep working past 62, the paychecks you’re getting should be keeping you alive and building your savings.

So here’s the bottom line: My hope for Ted, and for you, is that you retire whenever you want to. If you want to stop working and can enjoy a quality retirement by taking your Social Security when you’re 62, please do. And if you expect a shorter life than most, or face poor health in your retirement years, definitely take the money and run.

1. Work at least 35 years

Social Security benefits are calculated based on your 35 highest-earning working years. If you work fewer years, you’ll have years with zero income averaged in, which will lower your payout.

2. Ask for a raise

The more you make while working, the more you’ll make in Social Security, to a limit. So make as much as you can. Getting a second job is another way to accomplish the same thing.

3. Use online tools

If you’re unsure about the best time to claim benefits based on your individual budget, health, life expectancy or other factors, use online resources to help you decide. A good place to start is SocialSecurity.gov/MyAccount, where you’ll get your personalized statement. This estimates what your benefits will be at age 62, at full retirement age, or at age 70.

Once you get estimates for both you and, if applicable, your spouse, there are other online tools that compare your benefits under various scenarios to help you determine the best claiming strategy. AARP has a Social Security Benefits Calculator. Another option is to get a personalized analysis and claiming strategy. We can hook you up with that on this page of our Solutions Center.

4. Claim spousal benefits

If you’re married, you have a choice: You can either take the benefit based on your work history, or half your spouse’s benefit. So if your spouse earned a lot more than you did, and has a higher benefit as a result, compare and see which will pay the most.

You can also claim Social Security benefits based on an ex-spouse’s work record if you were married for at least 10 years. Doing so doesn’t reduce their check or otherwise impact them. In fact, they’ll never know you applied.

Again, if you’d like a personalized plan that will reveal the claiming option that will net you the most money, you’ll find it here.

5. Plan ahead for taxes

If the sum of your adjusted gross income, nontaxable interest and half your 2016 Social Security benefits exceeds $34,000 ($44,000 for couples), up to 85 percent of your benefits may be taxable. You can minimize this expense by using certain tax-saving moves, such as investing in annuities that allow you to earn interest that isn’t taxed until you withdraw it.

6. Clear your debts

Your Social Security benefits are protected from most debt collections, but they can be taken to collect unpaid federal taxes, federal student loan balances and child support or alimony. Clearing these debts will leave your Social Security benefits untouched.

What’s your strategy for claiming Social Security benefits? Have you decided? Share your thoughts in comments below or on our Facebook page.

Got a question you’d like answered?

You can ask a question simply by hitting “reply” to our email newsletter. If you’re not subscribed, fix that right now by clicking here.

The questions I’m likeliest to answer are those that will interest other readers. In other words, don’t ask for super-specific advice that applies only to you. And if I don’t get to your question, promise not to hate me. I do my best, but I get a lot more questions than I have time to answer.

About me

I founded Money Talks News in 1991. I’m a CPA and have also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate. I’ve been investing in both stocks and property for more than 35 years.

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I'm the founder of Money Talks News and have spent the last 40+ years in the personal finance trenches. I'm a CPA, author of a few books and multiple Emmy recipient. I'm ... More

I'm the founder of Money Talks News and have spent the last 40+ years in the personal finance trenches. I'm a CPA, author of a few books and multiple Emmy recipient. I'm married to a woman I don't deserve, have an awesome dog and live on the water in Fort Lauderdale, Fla.